Wisconsin Labor & Industry Review Commission Issues Unemployment Insurance Decision Regarding Tanita J Zegers vs. Nicole D May

MADISON, Wis., May 14 -- The Wisconsin Labor and Industry Review Commission issued the following Unemployment Insurance decision:

TANITA J ZEGERS, Employee

NICOLE D MAY, Employer

UNEMPLOYMENT INSURANCE DECISION

Hearing No. 14200212EC

An administrative law judge for the Division of Unemployment Insurance of the Department of Workforce Development issued an appeal tribunal decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the administrative law judge. Based on its review, the commission makes the following:

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The employee worked for a little less than two months as a stylist for the employer, a salon and day spa business. Her last day of work was December 6, 2013. The employee was discharged on December 9, 2013 (week 50).

On December 4, 2013, the employee was informed that her probationary employment period was being extended due to performance issues. She was told that her status would be reevaluated at the end of the month.

On Sunday, December 8, 2013, the employer's owner was reviewing time records when she noticed that one of her employees had worked beyond her scheduled hours the previous Friday. The owner requested further information and learned the worker had given the employee a facial after business hours. The employer had hosted a holiday open house, and the co-worker offered to stay and give the employee a facial afterwards. The on-site manager was aware that the service was being performed. When the owner asked the employee about the matter, the employee indicated that she mistakenly forgot to pay and would take care of it when she came in to work. The employer's policy allows for workers to receive services from colleagues as long as the service is scheduled in the appointment book and paid for at the time it is performed. The service provided to the employee on December 6 was not scheduled in the book and was not paid for at the time it was performed. The employee was discharged for receiving services without paying and for not meeting the employer's expectations.

The first issue to be decided is whether the employee's discharge was for misconduct connected with the employee's work under Wis. Stats. section 108.04(5).

Wisconsin Stat. section 108.04(5) provides that if an employee is discharged from employment with an employer due to actions that constitute misconduct connected with the employment, the employee will not be eligible for any unemployment benefits based on wages earned from prior work with that employer. In addition, the worker whose discharge was for misconduct will not be eligible for any benefit payments based on work for other employers until at least seven weeks have passed after the discharge and the employee has earned wages in new employment after the discharge equal to at least 14 times the employee's unemployment weekly benefit rate.

This legal standard for misconduct has been codified in the statutes by the legislature at Wis. Stats. section 108.04(5) as follows, in relevant part:

For purposes of this subsection, "misconduct" means one or more actions or conduct evincing such willful or wanton disregard of an employer's interests as is found in deliberate violations or disregard of standards of behavior which an employer has a right to expect of his or her employees, or in carelessness or negligence of such degree or recurrence as to manifest culpability, wrongful intent, or evil design of equal severity to such disregard, or to show an intentional and substantial disregard of an employer's interests, or of an employee's duties and obligations to his or her employer. In addition, "misconduct" includes:

(b) Theft of an employer's property or services with intent to deprive the employer of the property or services permanently, theft of currency of any value, felonious conduct connected with an employee's employment with his or her employer, or intentional or negligent conduct by an employee that causes substantial damage to his or her employer's property.

The employer alleged that the employee was discharged because she was unable to meet its standards and expectations and for "potential theft." An employer is required to prove an allegation of theft by presenting clear and convincing evidence. Kuehn v. Kuehn, 11 Wis. 2d 15 (1960); Ziegler v. Hustisford Farmer's Mut Ins. Co., 238 Wis. 238 (1941); Bohringer v. Grand Royale & Regency Resort, UI Dec. Hearing No. 05200559RH (LIRC Sept. 16, 2005).

The employer contended that the employee committed theft by receiving a facial without paying for it. However, the evidence presented is insufficient to support a finding that the employee intended to permanently deprive the employer of payment for the services. Although the employee did not pay for the services upon receipt, the evidence indicates that this was a mistake on her part and not intentional.

While the employer was generally dissatisfied with the employee's work performance, it did not establish that she engaged in any actions that were sufficiently careless or negligent to support a finding of misconduct. Further, the employee received the letter notifying her that her probationary period would be extended only a few days prior to her discharge and had no meaningful opportunity to improve.

Having determined that the employee's discharge was not for actions by the employee that rose to the level of misconduct, the next issue to be decided is whether the employee's discharge was for actions amounting to "substantial fault" connected with the employee's employment under Wis. Stats. section 108.04(5g).

Wisconsin Stat. section 108.04(5g)(a) provides that if an employee is discharged from employment with an employer due to actions that constitute "substantial fault," the worker will not be eligible for any benefit payments based on work for the employer that discharged him or her or from other employers until at least seven weeks have passed after the discharge and the employee has earned wages in new employment after the discharge equal to at least 14 times the employee's unemployment weekly benefit rate. That statutory section defines the phrase "substantial fault" as follows:

"[S]ubstantial fault" includes those acts or omissions of an employee over which the employee exercised reasonable control and which violate reasonable requirements of the employee's employer but does not include any of the following:

1. One or more minor infractions of rules unless an infraction is repeated after the employer warns the employee about the infraction.

2. One or more inadvertent errors made by the emp1oyee.

3. Any failure of the employee to perform work because of insufficient skill, ability, or equipment.

The employee received a facial without paying for it or noting it in the employer's appointment book. However, the employee's actions were not deliberate. The facial was not planned in advance, and her failure to pay for it at the time was an oversight. The employee's inadvertent actions cannot be considered "substantial fault," nor was it shown that she engaged in any other conduct that fell within that disqualification.

The commission therefore finds that in week 50 of 2013, the employee was not discharged for misconduct connected with her employment, within the meaning of Wis. Stat. section 108.04(5), or for substantial fault connected with her work, within the meaning of Wis. Stat. section 108.04(5g).

DECISION

The appeal tribunal decision is affirmed in part and reversed in part. Accordingly, the employee is eligible for benefits beginning in week 50 of 2013, provided she is otherwise qualified. The employee is not required to repay the sum of $1,197 to the Unemployment Reserve Fund.

Dated and mailed May 8, 2014

zegerta_urr . doc : 164 : MC 601 MC 601.2 MC 630.14 PC 714.03 PC 714.11

BY THE COMMISSION:

/s/ Laurie R. McCallum, Chairperson

/s/ C. William Jordahl, Commissioner

/s/ David B. Falstad, Commissioner

NOTE: The commission attempted to obtain the administrative law judge's impression of the demeanor of the witnesses. However, the administrative law judge had no demeanor impressions to provide. The commission's reversal is not based upon a differing assessment of witness credibility. Rather, the commission has reversed the finding of substantial fault because an incident that is considered a mistake for purposes of determining misconduct must also be considered a mistake for purposes of determining substantial fault.

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